If you’re a landlord already or you’re considering getting into the business, you probably share your main motivation with most others in this field – to make a profit from your property!
Ultimately, making money comes down to ensuring your gains outweigh any potential losses. When it comes to this business, you need to make sure you take adequate steps to minimise the risk of any huge and unexpected costs. This is where landlord insurance comes in, and could potentially save you a lot of stress and expense if any of the following disasters occur.
1) Unpaid rent
One obvious potential problem when you have tenants in your property is the question of what happens when they simply don’t pay their rent. This might happen due to a dispute resulting in their refusal to pay, or financial problems on their side like losing their job. Don’t let their problem become yours by making sure your landlord insurance covers this.
2) Emergency situations
It will be your responsibility as a landlord to find somewhere suitable for your tenants to temporarily live if there is some unexpected circumstance that makes your property uninhabitable. Examples might include flooding, fire or even pest infestation. If this isn’t covered by your insurance the costs could quickly skyrocket.
3) Public liability
In the event that your tenant or someone else sustains an injury on your property, they might take legal action against you for causing it through negligence if they blame the state of the property for the accident. Compensation and costs can really add up, so don’t take this risk.
4) Contents insurance
Your tenants will be responsible for insuring their own property and furnishings, but what about everything you’ve provided? Depending on what you’ve chosen to do, there may be a little or a lot that falls into this category. If it gets damaged, you will want your policy to cover the costs.
5) Legal costs
With most of the above situations, there is potential for disputes and disagreements to end up with legal action being taken. If you end up in court and need legal representation among other things, let alone any fees or penalties you might end up being hit with, not all insurance will cover these. Ensure you compare quotes and get the best deal before agreeing your landlord insurance policy.
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